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Price Statement: Hearing on “Examining the Delphi Bankruptcy’s Impact on Workers and Retirees”

WASHINGTON, D.C. | December 2, 2009 -

Good morning and thank you, Chairman Andrews. I would like to begin by thanking our two distinguished panels for appearing today. We appreciate that they have taken time out of their busy schedules to share their experiences and expertise with us.

Today’s hearing marks an opportunity to examine the impact of Delphi Corporation’s bankruptcy on its workers and retirees. I look forward to hearing in detail how different classes of workers and retirees will fare under Delphi’s bankruptcy, and what lessons we as policymakers might take away from this experience moving forward.

I’d also like to make two critical points before we proceed with testimony.

First, as our witnesses will explain today, I am deeply troubled to hear that different categories of workers appear to have been treated very differently in connection with this company’s bankruptcy. Some employees and retirees appear to have been given preferential treatment in the bankruptcy process and will enjoy full benefits. Many others – some of whom we will hear from today – are facing dramatic cuts in their pension and health benefits. Under any circumstances, it is shocking to learn that workers who worked side-by-side for the same company could find themselves in such uneven situations.

Second, and even more important, it is deeply troubling that the role of the federal government in dictating this unfair outcome is entirely unclear. Since February of this year when President Obama announced the creation of a presidential Task Force on the auto industry, the federal government has been intimately involved in reshaping this segment of our economy to an unprecedented level.

What the American people do know has been pieced together through media reports and court filings, not from the Administration itself. We know that the Treasury Department, and the President’s hand-picked “car czar,” was deeply involved in the negotiation of the restructuring of General Motors. We know that Washington is now a majority shareholder in General Motors, holding some 60 percent of its stock. We know that the Pension Benefit Guaranty Corporation has terminated Delphi’s pension plans – the legality of which is presently being challenged in federal court. And we know that General Motors has agreed to “top up” the pensions of some workers – notably, those in certain politically powerful unions – while leaving other workers and retirees high and dry.

There is so much more that the American people do not know at this point. What is the culpability of the federal government in this situation? What role did the White House and Auto Task Force play? How active was it in determining the “winners” and “losers”? And what terms did they dictate? To those questions, we have no answers.

Here we are with an opportunity to receive answers, and yet it defies logic that the Administration and its Auto Task Force are not here before us this morning to explain their actions and their role in these decisions. We had hoped the senior advisor to the Task Force, Mr. Ron Bloom, would answer those questions. Unfortunately, Mr. Bloom’s participation this morning could not be arranged.

This is disappointing and another example of this Administration failing to live up to its promises of accountability and transparency. But, more to the point, as a matter of substance, it leaves a gaping hole in our understanding of the true facts surrounding Delphi’s bankruptcy, and does a disservice to those who have so much at stake in this matter.